Stars of the Southwest

One third of the top-ranked logistics cities in the Southwest and West are in Texas and another third are in California. That's not surprising when it comes to international trade. The Ports of Los Angeles and Long Beach account for the majority of imports coming to the US from Asia. Similarly, northbound imports (and exports bound for Mexico) make the Texas border a busy spot indeed.

Balanced performance helps the Houston metropolitan area and the area included in the Dallas standard metropolitan statistical area (SMSA) to score among the top five sites nationally. Houston rated slightly worse than Los Angeles on road congestionand safety (Dallas was slightly better than LA). But one very tellingarea for California was in the taxes and fees incurred by logistics operations. (Using the star scale the Logistics Quotient employs for overall placement, California would bein the 1-Star range if it were judged on taxes and fees alone.) Whetheryour logistics operation is a deconsolidation center for imports,a distribution center for domestic shipments, or a combination of thetwo, the taxes in California might recommend moving goods inlandas quickly as possible. Oklahoma, with a rank of 15 has one of the besttax situations for logistics. With decent rail and air access, OklahomaCity makes its way into the top of the Southwest logistics sites.

Plentiful industry support was the rule for the top 10 cities—based on rankings for transportation and distribution industry resources. Though they are some of the more expensive markets generally, San Diego, Los Angeles, and Houston have some of the lowest cost and best availability for logistics workforce, based on measures used for the Logistics Quotient.

For shippers who depend on air cargo, some of the country's best sites are in the region. Los Angeles is ranked number three nationwide for air cargo access, San Francisco is number six, and Dallas is number seven.

If maritime is your preferred mode, Houston ranks number two in the country relative to access to waterborne commerce.

Dallas is number seven for rail access, the same position it holds for air cargo.

Most times, the top 10 cities in any given category (air, water, rail, etc.) will be among the top rated (5Star and 4-Star) cities overall, though some of those cities may fall outside the top 50, or even the top 100 in the national rankings. On occasion, a highly rated city in a particular category could come from lower national rankings—some 3-Star cities appear on the top 10 rail list for the Southwest. Given that logistics decisions are regional, the national rank can only take you part way down the path to a siting decision. The Logistics Quotient is a guide to help evaluate strengths and weaknesses of potential choices. Once you have a "short list" in hand, you'll want to set down your specific questions and issues to explore with various sources in the areas you are considering. And, you'll want to make some site visits to get a feel for a given area or site.

How to use the Logistics Quotient
The Southwest Regional Logistics Quotient matrix offers an overall ranking of each city within the region, assigning a 5-Star rank to the top tier, a 4-Star rank to the next group, and so on down to the 1-Star rank.

The Logistics Quotient also features 10 logistics-related categories with national numerical rankings on a scale from the top score of 1 down to 362 (the number of Metropolitan Statistical Areas ranked). Those categories are:

Transportation and distribution industry—based on business and employment base providing transportation, distribution, warehousing, and related services.

Work force cost—geared to existing and available logistics-related workers in the area.

Road infrastructure—-measures factors like available lane miles per capita, interstate highway access, miles of paved roads, etc.

Road density, congestion and safety—ranks the city on traffic volumes and delays as well as accident statistics and other factors affecting the smooth flow of traffic.

Road condition—draws on state performance and includes condition of highways and bridges, among other measures.

Interstate highway—includes access to intestate highways, spending on highway construction and maintenance.

Taxes and fees—provides a measure of logistics-related costs, including highway and fuel taxes and related business activity taxes.

Railroad—offers a state-based rank of access to Class 1 and other rail services and miles of track.

Waterborne commerce—includes ocean port capacity as well as inland waterways.

Air cargo—ranks the city on its access to cargo services, including widebody passenger service by combination carriers, international, and expedited services.

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